The BSE SENSEX was created in the year 1979 as benchmark to track the Indian Stock Market. Since then 100s of stocks have moved in and out of the SENSEX depending on the Economy. We’d like to present to our esteemed readers the Historical returns BSE SENSEX has delivered since its inception. All the Dates taken into account for calculation are as on March-31st of respective years.
Between 1979 and March 2015, BSE Sensex has delivered a CAGR return of 16.45%. The following chart shows the same on a 1, 3,5,7,10,15,20, and 30 year basis. What does that mean ? If you have invested in SENSEX on April-1st of 2014, by March-2015 you would have gotten a return of 24.89%. Similarly for other periods as shown in the chart below.
Important Advise to Readers If you look at 10 Year or greater period and wonder why should one stay invested for 15% to 16% CAGR returns, then you are asking the right question. This RoI is on the benchmark SENSEX. However, we have always advised you to take the Mutual Fund route which deliver significantly higher returns as fund managers often load stocks & sectors which outperform the benchmark itself. For instance, a 10 Year SIP in HDFC Top 200 Fund has delivered 18.24% returns while the SENSEX has delivered a 15.72% returns[ SENSEX is Point to Point].
In conclusion, we would stay invested in the Indian Equity Market by means of SIP and Top-Ups when the Markets Crack under pressure. Do follow us on twitter to stay current with our long term wealth creation strategy, tax free and transparently.